Blake: DIA sends ominous signals on cab competition

For years, Denver International Airport has let all licensed cab companies operate there.

Now the airport is putting taxi service out to bid, giving rise to suspicions it is trying to set up a monopoly, or perhaps a duopoly.

Details haven’t been made public, and aren’t expected until the end of September.

Currently six cab companies are authorized to serve the airport. To avoid having too many cabs clog up the roads and the holding area, the airport rations the slots available. It has been done in what seems to be an eminently fair way: Each company is allowed to send 20 percent of its authorized fleet size to the airport daily.

Green Taxi Cooperative, which recently started up, was authorized to send just 20, although that’s less than 20 percent of the 150 cabs it is currently operating and far less than the 800 it is authorized.

In mid-July, Kim Day, DIA’s chef executive officer, sent a letter to cab operators saying the airport “needs to revisit the process by which taxis are allocated” because of recent decisions by the Colorado Public Utilities Commission regarding the permitted fleet size of the companies.

Until a new policy is established, she wrote, “there will be a moratorium on increasing or decreasing the allocation of taxis” at DIA.

On Aug. 29, DIA included “taxi service” among the “future opportunities” it listed for projected competitive contracts.

“The successful taxi companies will operate the taxicab service on a 24 hours a day, 7 days a week, 365 days a year basis, and must incorporate the the industry’s best practices to enhance professionalism, customer satisfaction, passenger safety and security.”

There was no indication of how this contract would be bid — flat annual fee, or a per-trip charge, or any number of other options. Nor does it say how many companies will be authorized. Dorothy Harris, senior vice president for parking and transportation, and Herald Hensley, director of parking and transportation, didn’t return calls seeking more information.

But Cristina Lopez, the contract administrator, said the contract is just in the “development stage” and “we don’t have any information to disclose right now.” More details will be forthcoming when the request for quotations is released in 30 days, she said.

If they really don’t know what they want, why did they post anything, asked Abdi Buni of Green Taxi.

File photo – Todd Shepherd

Cab service makes plenty of money for the airport already. Currently each cab pays $4.57 per trip to the airport. As noted above, there are 301 cabs authorized each day. If each one hypothetically makes a four trips a day — a conservative estimate — that’s $5,500 a day to the airport, less whatever the starter costs..

The smaller companies are highly suspicious that Metro and Yellow, two large old-line companies with good political connections, have something to do with this new plan. They are getting increasing competition from the newer companies, as well as from Uber and Lyft, two ride-sharing firms that do business at the airport.

DIA wouldn’t be the first airport to limit taxi service. This summer the airport in Charlotte, N.C., authorized four companies to serve the airport and eliminated eight others, which prompted a large protest from the losers.

The decision was ratified by the Charlotte city council, even though some members protested that the government shouldn’t be picking winners and losers.

Presumably any future taxi contract in Denver would also have to be ratified by our city council. That would also be controversial, not least because a large percentage of the drivers for all local cab companies are African-American and immigrants.

Buni, asked if Green Taxi would bid on any possible airport contract, said, “Why would I ask the airport to say, ‘give it to me alone.’ That’s not good for the public interest.”

Ray Gifford, a former chairman of the PUC and a lawyer who specializes in transportation, suggested that any move to limit the number of cab companies serving the airport would prompt a lawsuit over the relative powers of the PUC and Denver, a home-rule city.

The issue, he said, would be: “Does state law preempt the city’s ability to countermand access?”

There has been a healthy trend toward more competition in ground transportation in Colorado. The airport would be taking a step backward by trying to re-establish a monopoly or near-monopoly.